S&P puts 15 Euro nation credit ratings on review
“Today's CreditWatch placements are prompted by our belief that systemic stresses in the eurozone have risen in recent weeks to the extent that they now put downward pressure on the credit standing of the eurozone as a whole,” S&P said
Tue, 06 Dec 2011
Standard & Poor’s has put the credit ratings of 15 eurozone nations under review as the ratings agency issues a stern warning ahead of this week’s critical European Union debt talks.
The move followed media reports that S&P was poised to act.
In a statement issued on Tuesday morning, S&P said it was placing 15 members of the European Economic and Monetary Union, or eurozone, on “creditwatch negative” in response to tightening credit conditions and higher risk premiums.
“Today’s CreditWatch placements are prompted by our belief that systemic stresses in the eurozone have risen in recent weeks to the extent that they now put downward pressure on the credit standing of the eurozone as a whole,” S&P said in a statement.
The agency outlined five reasons for the decision:
Tightening credit conditions across the eurozone;
Markedly higher risk premiums on a growing number of eurozone sovereigns, including some that are currently rated ‘AAA’;
Continuing disagreements among European policy makers on how to tackle the immediate market confidence crisis and, longer term, how to ensure greater economic, financial, and fiscal convergence among eurozone members;
High levels of government and household indebtedness across a large area of the eurozone; and
The rising risk of economic recession in the eurozone as a whole in 2012.”
S&P added that its credit rating review would consider “political”, “external” and “monetary” factors and that it expected to complete the review “as soon as possible” after the European Union summit scheduled for December 8 and 9.
Tue, 06 Dec 2011
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